The challenge of cost versus sustainability for university estates

There's no doubt that the higher education sector is in transition, but with several competing challenges, how can sustainability ambitions prevail and lead the sector into a new era? Richard Freeman, Principal Business Development Manager, explains.

A few weeks ago, I attended AUDE’s Annual Conference at Northumberland University and met with like-minded professionals, equally invested in the future of UK universities. It was a timely reminder of the fundamental changes taking place within the sector.

From shrinking revenue streams to rising student expectations, the changes have one thing in common – they all have an impact on the sector’s focus on sustainability. Challenging finances mean estate improvements, including those to improve energy efficiency, could be delayed, while the rising environmental interest among students may pressure universities to take more urgent action.

One thing is for certain; it’s unlikely that universities will achieve their estate sustainability ambitions alone. Decarbonisation, whether it's through the creation of new, energy efficient facilities or through retrofitting existing buildings, is a complex undertaking made easier through collaboration. It’s clear that many universities want to make a difference and have showcased that through their sustainability strategies, however, these need private sector support to enable them to come to fruition in such challenging financial times.

The estimated cost of achieving net-zero carbon across the higher education sector is £37.1bn, as revealed within AUDE’s ‘The Cost of Net Zero’ report, highlighting the scale of the task. In some cases, universities have been fortunate enough to receive sought after decarbonisation funding only to lose it further down the line.

With the sector’s future in the balance, we can help.

I believe the solution to the sector’s sustainability and funding challenges to be circular – maximising available funding, optimising existing space, bringing in the right partners and generating income through these partners, will ultimately help drive capital development projects.

The sector is going through a period of flux with new international student visa regulations causing financial turmoil for some universities. This only adds to the reliance on external funding opportunities – such as the Public Sector Low Carbon Skills Fund and Public Sector Decarbonisation Scheme. However, these can sometimes be complicated to unlock and need early collaboration with private sector partners, including contractors and consultants, for their full potential to be realised. This engagement results in a clear view of the overall capital that’s required for a scheme, as well as a build programme that aligns to funding requirements and costs that are clear and transparent for the university from the outset.

I have already seen some universities pursue alternatives to capital projects with traditional contracts, opting for the benefits offered by models such as design-build-finance-operate (DBFO). Our construction expertise is already being utilised within a DBFO model to make the most of private sector partners and investment – creating new student accommodation that will enhance a university’s estate and associated sustainability credentials.

Another way to balance sustainability and decarbonisation with budget is to reassess existing spaces. Our Development Solutions team work with universities to review and unlock potential and help them to achieve better value from their existing assets.

There isn’t a clear answer as to whether universities are achieving their sustainability ambitions, but I am certain there is untapped potential either way.

If you would like to learn more about how we can help with some of the issues and opportunities then please contact me, or register your interest for our future webinars here.

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